CONTENTS
ECONOMIC GROWTH --
DISCUSSION --
SUMMARY OF GROWTH IN AUSTRALIA --
FACTORS AFFECTING THE AUSTRALIAN ECONOMIC GROWTH RATE
• POSITIVE FACTORS
• NEGATIVE FACTORS --
AUSTRALIAN GOVERNMENT’S POLICIES
CONCLUSION
REFERENCE LIST
ECONOMIC GROWTH
Nowadays, a tough competition exists between countries for the development and advancement of their different economic sectors. These developments are made in their health, education, social and industrial sectors etc., in order to support the entire economy and to improve their growth and development altogether.
Economic growth can be referred to as the continuous change in the total output with time, while economic development is the persistency in the general improvement
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Australian government has out minimal restrictions on the imports of products and services. this has made the imports flexible, which has stimulated the economic growth rate of Australia with the increase in productivity of commodities which makes the economy even more flexible. This higher level of production satisfies more needs and wants because of the availability of more goods and services.
Another factor in shaping the economic growth in Australia is Tourism. In the financial year 2014-15, it was observed that 3.0% of the total GDP was contributed by tourism total amounting to 47.5 Billion US dollars (Australian Bureau of Statistics). The following graph shows that tourism provided 580,000 jobs to the employers in Australia in the years
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At the time, when the rate of unemployment is high, the level of income is low. Low income leads to lower purchasing power of the people. When people but less products and services, this reduces the demand for goods and services resulting in compelling the manufacturers to manufacture less commodities and products to maintain the equilibrium in the market. The decrease in production affects the economy of the country directly as there will be less tax collection with less market demand for goods and services. Therefore, the government will conduct less welfare and infrastructure activities.
STEPS TO COMBAT UNEMPLOYMENT
The government of Australia has taken many steps to combat unemployment and finish it from the economy. At present, every country is devising policies for the maintenance of balance in the employment in the country and to develop their economy. The Australian government has levied many policies in different states and territories in order to increase their growth
Economic growth refers to an increase in the volume of goods and services produced in the economy in a specific period of time (Cave, D, et.al). After being re-elected Malcolm Turnbull stated “We want higher economic growth that provides prosperity to everyone” (Daley, 2016). But since Turnbull became priminister in 2015 the economic growth rate was 2.5% according to the (ABS), and now not much has changed, in fact we have decreased to 2.4% (ABS) as of April 5 2017 and being lower then this before after nearly entering a recession. The coalition however, introduced a policy for growth where they would deliver a company tax cut for small businesses dropping the tax rate for businesses with an annual turnover of less than $10 million, which seemed a very positive move for growth in Australia however this policy has failed due to the negative quarter after this policy was implemented. As GDP (Gross Domestic Product) a main economic indicator for Economic growth shows the near recession, we faced at the end of 2016.
"Australia." Economy: Population, GDP, Inflation, Business, Trade, FDI, Corruption. N.p., n.d. Web. 2 Dec. 2013. .
Over the last 20 years, the Australian economy has picked up as a result of imported skill labour. Australia offers a wide range of safe and relatively fair job opportunities. Lastly, basic education in Australia is free and universities offer a wide range of courses to accustom for the student’s abilities and desires.
Various definitions of tourism exist. Tourism is defined by Macmillan Online Dictionary as the business of providing services for those people travelling for holidays. Tourism has experienced continued growth over the years and diversification and has become one of the fastest growing economic sectors in the world. For countries like Australia, it has become one of the major contributing sectors in the economy generating large proportions of the national income and at the same time increase employment opportunities. The future is still bright for the industry in the country with possible future growth in expansion and diversification. The industry however has both the pros and cons impacts to various ranges of environments (Tourism Research Australia).
Every year there is a ‘league table‘ published showing the level of economic growth achieved by each country. The comparison is made using each countries Gross Domestic Product, or GDP. An important factor to look at is the difference between actual and potential economic growth. Actual economic growth increases in real GDP. This increase can occur as result of using previously unemployed resources, or reallocating resources into more productive areas or improving existing resources. Whereas potential economic growth is the productive capacity of the economy. For example, it can be shown by the predicted ability of the country to produce goods and services. This changes when there is an increase in the quantity or quality of the resources. All countries have different ways of achieving this with the resources they have available to them. For this reason it party answers the question of why some countries are richer than others. It is widely thought that the productive capacity of an economy will increase each year largely due to improvements in education and technology. This will obviously differ from country to country. For example, in the UK the quality of fertilizer could be improved, hence forth increase the years fruit and vegetable output.
Five years ago, in the middle of 1997 Australia’s economic growth had begun to upturn after a period of recession during the ’96 year. This was unmistakably shown through the composite indicators of retail trade, dwelling investment and Australian share market valuations, all concurring with one another and demonstrating the effects of an upturn in economic growth.
Australia has had one of the most outstanding economies of the world in recent years - competitive, open and vibrant. The nation’s high economic performance stems from effective economic management and ongoing structural reform. Australia has a competitive and dynamic private sector and a skilled, flexible workforce. It also has a comprehensive economic policy framework in place. The economy is globally competitive and remains an attractive destination for investment. Australia has a sound, stable and modern institutional structure that provides certainty to businesses. For long time, Australia is a stable democratic country with strong growth, low inflation and low interest rate.(Ning)
The largest cause of unemployment can be attributed to recession. The term recession refers to the backward movement of the economy for a long period. People spend only when they have to. (Nagle 2009). With people spending less there would be less money in circulation therefore, enterprises would suffer financially and people would suffer too. This is so because recession reduces the fiscal bases of enterprises, forcing these enterprises to reduce their workforce through layoffs. These enterprises lay off their workers in order to cut the costs they incur in terms of wage and salary payments.
Unemployment is a macroeconomic factor that is pertinent to an extensive economy at a regional level. Therefore it affects a large population rather than a few select individuals. Unemployment does not only have social costs, but economic costs too. The ILO, International Labour organization, defines unemployment as, ''People of working age, who are without work, but available for work and actively seeking employment.'' Therefore implying that it is a state of an individual looking for a job but not having one. Unemployment is one of the key indicators in determining the economic stability of a country; hence governments, businesses and consumers closely monitor it. There are numerous aspects that might lead to unemployment such as labour market conflicts and recessions in the economy. There are two main types of unemployment, which can be focused on, seasonal and cyclical unemployment. Seasonal unemployment occurs when a person is unemployed or their profession is not in demand during a particular season. On the contrary, cyclical unemployment occurs when there is less demand for goods and services in the market so consequently supply needs to be decreased.
Unemployment in the United States A lot of the people in the United States of America are suffering of unemployment. If a person does not have a job, they do not have money to support their families and themselves. Unemployment would soon lead to poverty because if more people become poor, businesses would have a decrease in their customers which would cause the businesses to fail. Jobs should also pay more money.
Due to increasing demand for natural resources such as coal and iron ore (Anthony, 2016) the mining sector of Australia boomed as it exported to countries such as China (Heath & Petrie, 2016). Thus, affecting the Australian Gross domestic product (GDP). GDP is “the market value of all final goods and services produced within a nation 's geographic borders during a period of time, usually a quarter or a year” (Layton, Robinson, & Tucker, 2016, p. 257) and helps to measure economic growth. The components of GDP are derived from the formula GDP = C + I + G + (X - M). That is, gross domestic product = consumption + investment + government spending + (exports - imports).
Economic growth is one of the most important fields in economics. In current generation economic is developing well. Economic growth is really important to country and for the world as well. Economic are one of the identity for country because it shows a country development and attraction for other countries (F, Peter. 2014). For example well economic develop such as Singapore, Dubai, New York, and Japan. These countries are well develop and maintaining their economic growths. Economic growths are really important because higher average incomes enables consumers to enjoy more goods and services. Then, lower unemployment with higher output and positive economic growth firms tend to utilize more workers creating more employment. Enhanced public
Unemployment issue can lead to a lot of impacts to the economic growth. Higher unemployment rate will lead to increase government borrowing. When people are without their job, they would paid less in the income tax. So, it will cause a drop in tax revenue because there are lesser people paying income tax and spending less. Due to the loss of earnings to the unemployed, the government need to spend more subsidy for them in housing benefits and income support.
The economy can be clearly identified as the most beneficial aspect of tourism. “According to recent statistics, tourism provides about 10% of the world’s income and employs almost one tenth of the world’s workforce” (Mirbabayev, 2007). In Australia alone, Tourism contributed $87.3 billion in 2012, and employed 908,434 (7.9%) people (Kookana & Duc Pham, 2013). Tourism is “one of the most profitable and rapidly developing industries in the world” (Popushoi, 2004). Every year the number of tourists increase dramatically and consequently the revenues from tourism will increase substantially.
Economic development has direct relationship with the environment. Whereas economic development is a policy intervention endeavour with aims of economic and social well-being of the people, economic growth is a phenomenon of market productivity and rise in